Any parent wants to give their child the best education they can possibly get to set them up for success, but have you ever wondered just how much it costs?
For parents that are looking to take the public school route, you could be looking at dishing out R1.6 million to cover their education from grade R right up to varsity. However, parents looking to send their children through private schools and university could be looking at R3.7 million.
Leaving this to last minute can be overwhelming for many parents, which is why it matters that you start to prepare for your child's future as soon as possible. But where do you start to avoid a process that will end up putting a financial strain on your finances? Here are some handy tips to help you prepare for your child's education.
Think of the bigger picture
There are a variety of expenses parents have to deal with when it comes to having a child that they have to take care of until they can stand on their own feet. School uniforms, stationery, lunch, excursions and extracurricular activity are just some of the expenses that you need to prepare for.
But before you do so, it is important to decide whether you will be sending your child to a public or private school. Knowing this can help you plan accordingly. Involving a financial planner can also make the process suitable for your financial situation and help you be better prepared.
Do your research on what it costs
The current education inflation currently sits at 9%. We may not know the exact cost of your child's education due to many contributing factors, but you can be prepared by doing your research. One certain thing is that the cost of education is increasing.
Wrapping your head around the cost of uniforms, stationery, and extra curriculum activities can make it easier to plan for the long run. While you may be working with estimates, it will be better to have to pay a couple of hundred Rands extra in future than to look for lump sums or loans to cover the needs of your child. Doing this can also help you set realistic savings goals and reveal where you need to cut back to contribute towards your child's education.
What are your investment options?
Assessing your financial options can help you compare which one will help boost your savings. There are a wide range of educational plans that are available and can become useful to your situation. However, it is crucial to speak to a financial advisor to find one that will be best suitable for your situation. It will make it easier for you to choose between things such as endowments, unit trusts, tax-free savings and fixed deposit savings accounts.
Start preparing as soon as possible
The best time to start planning for your child's future is today. Keep in mind that it will require you to be disciplined when it comes to putting away money that will benefit them tomorrow. However, it is equally important to have life insurance in place to ensure that their financial future is protected even when you are no longer alive to do so.